NORTH COAST PRODUCTIONS, INC.,
THE STORM HIGH PERFORMANCE SOUND CORPORATION
STOCK PURCHASE AGREEMENT
This Agreement and Plan of Merger, dated January 28, 2000 is entered into
by and between The Storm High Performance Sound Corporation (hereinafter
referred to as "Storm" or "the Company"), and North Coast Productions, Inc.
(hereinafter referred to as North Coast or the "Buyer").
1. Storm is duly organized and existing as a corporation under the laws
of the State of Florida, having an authorized capital stock of 50,000,000
shares, par value $.001, of which 8,521,599 shares of common stock are issued
and outstanding.
2. North Coast is a corporation duly organized and existing under the
laws of the State of Washington having an authorized capital stock consisting of
100,000,000 shares of common stock, par value $.001, of which 5,000,000 shares
are issued and outstanding.
3. The board of directors of each of Storm and North Coast
(collectively the "Constituent Corporations") deem it advisable, for the general
welfare and advantage of the constituent corporations and their respective
shareholders that Storm issue 7,115,593 shares of Common Stock to North Coast in
exchange for a cash infusion of three hundred thousand dollars ($300,000), that
as a result of the transaction covered by this Agreement, Storm will become a
subsidiary of North Coast and North Coast will have full control of Storm, and
that subsequent to Storm becoming a subsidiary of North Coast, North Coast will
merge North Coast into Storm with Storm being the surviving corporation and
North Coast ceasing to exist (the "Merger").
4. The Buyer warrants on or before March 31, 2000, it will duly combine
the Constituent Corporations in accordance with the provisions of the Florida
Statutes Annotated. The Buyer warrants that by March 31, 2000, it will duly
file Articles of Merger with the Secretary of the State of the State of Florida
to effect the Merger. Said filing shall be the sole responsibility of the
Buyer.
Amended and Restated Articles of Incorporation
5. The Buyer warrants that on or before March 31, 2000, as part of the
Merger, the Amended and Restated Articles of Incorporation of the Surviving
Corporation shall be amended to read as follows: (the term "Corporation" as used
in this article referring to the "Surviving Corporation"):
(a) First: The name of the Corporation is North Coast Productions,
Inc.
(b) Second: The principal office of the Corporation is
located at 0000 000xx Xxxxxx, XX Xxxxxxxx, Xxxxxxxxxx 00000.
(c) Third: The Corporation is formed for the purpose of making of
movies in the entertainment industry, consultation and operation and for doing
all things of every kind incident to the business, including but not limited to:
(d) Engaging in any lawful activity and to manufacture, purchase
or otherwise acquire, invest in, own mortgages, pledge, sell, assign and
transfer or otherwise dispose of, trade, deal in and deal with goods, wares and
merchandise and personal property of every class and description;
(e) Holding, purchasing and conveying real and personal property
and to mortgage or lease any such real and personal property with its franchises
and to take the same devise or bequest;
(f) Acquiring, and paying for in cash, stocks, bonds or any other
security of this Company, the good will, rights assets and property and to
undertake or assume the whole or any part of the obligations or liabilities for
any person, firm, association or corporation;
(g) Acquiring, holding, using, selling, leasing, granting
licenses in respect of, mortgage or otherwise, disposing of letters of patents
of the United States or any foreign country, patent rights, licenses and
privileges, inventions, improvement and processes, copyright, trademarks and
trade names relating useful in connection with any business in this Corporation;
(h) Borrowing money and contracting debts when necessary for the
transaction of its business, or for the exercise of its corporate rights,
privileges or franchises, or for any other lawful purpose of its incorporation;
issuing bonds, promissory notes, bills of exchange, debentures and other
obligations and evidence of indebtedness, payable at specified time or times or
payable upon the happening of a specified event or events, whether secured by
mortgage, pledge or otherwise, or unsecured for money borrowed, or in payment
for property purchased, or acquired, or for any other lawful objects;
(i) Doing all and everything necessary and proper for the
accomplishment of the objects enumerated in this plan or necessary or incidental
to the protection and benefit of the Corporation and, in general, carrying on
any lawful business necessary or incidental to the attainment of the objects of
the Corporation, whether or not such business is similar in nature to the
objects herein set forth above.
(j) Fourth: Section 1. The maximum number of shares which the
Corporation is authorized to have outstanding is 100,000,000 shares, which shall
be classified as common stock.
Authorization and Sale of the Shares
6.1 Authorization. Storm is authorized to issue pursuant to the terms
and conditions hereof of up to 7,115,593 (seven million one hundred fifteen
thousand five hundred ninety-three) shares of Storm's Common Stock.
6.2 Sale. Subject to the terms and conditions hereof, Storm will issue
to the Buyer and the Buyer will purchase from Storm shares of Common Stock (the
"Securities") at a purchase price of three hundred thousand dollars ($300,000)
(the "Purchase Price") . Of the $300,000 Purchase Price, the initial fifty
thousand dollars ($50,000) shall be placed in an escrow account (the "Escrow
Account") as set forth in the Escrow Agreement attached hereto as Exhibit A. The
title on the Escrow Account is as follows:
SHPE/NCPI
The parties hereto acknowledge that the Buyer has tendered to the Escrow Agent,
the Law Firm of Xxxxxx-Xxxxxxx, P.C., an initial payment in connection with this
Share Purchase a check made payable to SHPE/NCPI in the amount of Ten Thousand
Dollars ($10,000.00). Said funds were immediately and without delay deposited
in the Escrow Account created specifically for this transaction and were paid
for the purposes set forth in paragraph. This ten thousand dollar payment is a
partial payment of the $50,000 to be deposited in the Escrow Account. The
pertinent banking coordinates and other information for the Escrow Account are
as follows:
Name of Bank: The Xxxxx National Bank
Address: 0000 X Xxxxxx XX
Xxxxxxxxxx, X.X. 00000
Telephone No.: (000) 000-0000
Fax No.: (000) 000-0000
Bank Contact: Xxxxxxxxx Xxxxxx Xxxxxxx
Vice President/ Branch Manager
Account Title: SHPE/NCPI Escrow Account
Account No.: 00000000
ABA No.: 000000000
7. Payment to Storm by Buyer. By February 4, 2000, the Buyer shall
tender to the Escrow Agent a non-refundable deposit of fifty thousand dollars
($50,000) (the "Non-Refundable Deposit"). The Buyer may request an extension of
time to make the Non-Refundable Deposit but the right to grant the extension
shall be the sole right of Storm and Storm may set the new payment date for the
Non-Refundable Deposit. If the Buyer fails to tender the Non-Refundable Deposit
and Storm declines to grant an extension, the Buyer shall be in breach of this
Agreement. By February 4, 2000, the Buyer shall open an account with the Xxxxx
National Bank ("Xxxxx Bank") at 0000 X Xxxxxx, XX, Xxxxxxxxxx, X.X. 00000 for
the purpose of depositing the Buyer's payments which shall total $250,000
exclusive of the $50,000 to be deposited in the Escrow Account. The Buyer shall
provide instructions to Xxxxx Bank authorizing Xxxxx Bank to respond to balance
verification requests of the Escrow Agent. On or before March 31, 2000, the
Buyer shall deposit or cause to be deposited in the Deposit Account at Xxxxx
Bank, $250,000 as payment to Storm. If by March 31, 2000, the Buyer has not
successfully deposited or caused to be deposited a minimum of seventy-five
percent (75%), or two hundred thirty-two thousand five hundred dollars,
($232,500.00) under the aforementioned Deposit Escrow Agreement, such failure
shall constitute a material breach of this Agreement. As a result of such
material breach and as liquidated damages, Storm is entitled to keep the
Non-Refundable deposit of fifty thousand dollars ($50,000.00) deposited in the
Escrow Account. In the event the Buyer so breaches this Agreement and forfeits
$50,000 as liquidated damages, the remaining balance paid by the Buyer shall be
returned to the Buyer without delay.
8. In the event the Buyer has, in fact, deposited or caused to be
deposited a minimum of two hundred thirty-two thousand five hundred dollars
($232,500.00), the Buyer may request an extension to pay the balance of the
Purchase Price, but Storm shall have the sole right in its discretion to grant
the extension to a date Storm deems appropriate.
9. Closing Date; Delivery and Effective Date
(a) The closing of the purchase and sale of the Securities to the
Buyer shall occur contemporaneously at Xxxxx National Bank in Washington, D.C.
The official closing date ("Closing Date") of this Agreement shall be March 31,
2000, unless extended by Storm in accordance with Section 8 of this Agreement.
(b) Delivery. At the Closing, Storm shall cause to be delivered,
via overnight delivery, to the Buyer the Securities to be purchased by the Buyer
from Storm, in accordance with the terms of the Escrow Agreement. Namely, the
Buyer shall deposit in the aggregate three hundred thousand dollars
($300,000.00) at Xxxxx National Bank in Washington, D.C. for the purpose of
performing this Agreement. The Escrow Account titled SHPE/NCPI shall have the
sum of fifty thousand dollars ($50,000.00). Xx. Xxxxxxx Xxxxxxx ("Xx. Xxxxxxx"),
a principal of the Buyer, will open a separate and subsequent deposit account
(the "Deposit Account") to receive the balance of two hundred and fifty thousand
dollars ($250,000). The Deposit Account shall remain under the full and
complete control of Xx. Xxxxxxx. However, Xx. Xxxxxxx will instruct Xxxxx
National Bank, in writing, with a copy to the Escrow Agent, to allow the Escrow
Agent access to information about the money deposited into the Deposit Account.
Once $250,000 have been deposited into the Deposit Account and $50,000 have been
deposited into the Escrow Account such that the Buyer has deposited an aggregate
of $300,000, Storm will transfer or cause the Securities to be transferred to
the Buyer. The Buyer and Storm agree that the funds held in the Escrow Account
referred to herein shall be disbursed in accordance with the Escrow Agreement
executed by the parties. The Escrow Agreement shall be effective
contemporaneously with this Agreement and is annexed as part of this Agreement
as Exhibit "A". On or prior to closing, Xx. Xxxxxxx, representing the Buyer,
and Xxxxx Xxxxxx-Xxxxxxx on behalf of the Escrow Agent, shall jointly appear at
Xxxxx Bank and jointly issue and verify payment to the list of creditors as set
forth in the schedule of payments attached hereto as Exhibit B.
(c) Effective Date: The Effective Date of this Agreement shall be
January 28, 2000.
(d) Post Delivery of Stock Certificates. The post delivery
allocation of the securities of Storm shall be as follows:
SHAREHOLDERS AMOUNT PERCENTAGE
----------- -------
NCPI Shareholders 7,115,593 83.50
Pre-Combination Storm Shareholders* 1,198,999 14
Xx. Xxxxxx Xxxxxxxxxx 103,504 1.25
Xx. Xxxxxxx Xxxxxxxxx 103,503 1.25
----------- -------
TOTAL ISSUED AND OUTSTANDING 8,521,599 100
*Exclusive of Messrs. Hannaberry and Zacharoff.
10.0 Contemporaneously with Storm's delivery of the Shares to the Buyer
pursuant to 9(b) of this Agreement, Messrs. Xxxxxx Xxxxxxxxxx and Xxxxxxx
Xxxxxxxxx, the majority shareholders of Storm collectively owning 7,237,384
shares of Storm Common Stock, shall tender 7,030,377 shares back to Storm and
Storm shall retire such shares. In exchange for such shares, Storm shall convey
to Messrs. Hannaberry and Zacharoff all of Storm's assets that Storm owns as of
January 28, 2000, but not including assets acquired by Storm after January 28,
2000. The parties hereto acknowledge that Storm presently has no operations and
that Storm's remaining shareholders will benefit from the contemplated Merger in
that an operating company will be merged into Storm.
10.1 The parties hereto acknowledge that Messrs. Hannaberry and
Zacharoff have personally sold an amount of shares equal to one percent (1% ) of
the total shares outstanding of Storm to the Buyer in the open market pursuant
to Rule 144 in the amount of $10,652. The $300,000 Purchase Price for Storm's
shares under this Agreement is exclusive of the shares personally sold by
Messrs. Hannaberry and Zacharoff and the amount received for such personal sale
shall not be included in any amounts upon which any other calculations are made
in this Agreement or any other agreement.
10.2 After consummation of this Agreement, the remaining shares held by
Messrs. Hannaberry and Zacharoff shall be subject to a lock-up agreement
effective contemporaneously with Storm's issuance of the Securities. Messrs.
Hannaberry and Zacharoff shall be prohibited from selling such shares (the
"Lock-up Shares") into the securities markets during the period beginning on
January 7, 2000, and ending July 7, 2000. The shares personally sold by Messrs.
Hannaberry and Zacharoff as set forth in 10.1 are not included in the Lock-up
Shares. Beginning on July 8, 2000 Messrs. Hannaberry and Zacharoff are each
permitted to sell a maximum of twenty-five percent ( 25%) of their respective
stock on a monthly basis. However, in the event either Xx. Xxxxxxxxxx or Xx.
Xxxxxxxxx does not sell his respect 25% allotment in any particular month, he
will be permitted to add the unsold portion to the amount he can sell in the
following month. The Buyer shall have the first right of refusal to acquire
shares so offered for sale by Messrs. Hannaberry and Zacharoff at the Common
Stock's closing price on the date immediately prior to Xx. Xxxxxxxxxx'x or Xx.
Xxxxxxxxx'x offer to sell their respective shares. Should the Buyer exercise
its first right of refusal, it will have five (5) business days to close on a
purchase of the stock.
10.3 Upon the Buyer's tender of $50,000 to the Escrow Agent, Messrs.
Xxxxxx Xxxxxxxxxx and Xxxxxxx Xxxxxxxxx, being the only officers and directors
of Storm, shall tender their resignations as officers and directors. In their
capacity as majority shareholders, Messrs. Xxxxxx Xxxxxxxxxx and Xxxxxxx
Xxxxxxxxx shall appoint by consent Messrs. Xxxxxxx Xxxxxxx and Xxxxxxxx X.
Xxxxxx to serve as directors of Storm for a special term to end on Mach 31,
2000. In their capacity as directors, Messrs. Xxxxxxx and Xxxxxx shall appoint
themselves as the sole officers of Storm. In their capacity as directors,
Messrs. Xxxxxxx and Xxxxxx shall only be empowered to take those steps necessary
to duly effect a lawful offering of Storm's securities solely in the State of
Washington, and shall not take any other action on behalf of Storm without
majority shareholder approval. Messrs. Xxxxxxx and Xxxxxx shall not disburse
any proceeds from such offering except to the extent necessary to tender payment
for the shares being sold under this Agreement should some of the proceeds from
such offering be used in such manner. The parties hereto acknowledge that the
offering is anticipated to be the source of payment for the Purchase Price
though it need not be the exclusive source for such payment. Otherwise, the
proceeds shall not be disbursed for any reason until after the Buyers have paid
the full Purchase Price as set forth herein. Any such offering of Storm's
securities shall be limited to an amount of securities such that Messrs.
Hannaberry and Zacharoff shall retain a majority of the voting power of all the
shares in Storm. Should said offering be unsuccessful in raising an amount
sufficient to pay the Purchase Price set forth herein, any funds raised pursuant
to said offering shall remain the property of Storm and upon the termination of
Messrs. Xxxxxxx and Xxxxxx'x terms as directors on March 31, 2000, Messr.
Hannaberry and Zacharoff may reelect themselves as directors, or any other
persons to serve as directors as Messrs. Hannaberry and Zacharoff deem in the
best interest of Storm. Any violation of this provision by Messrs. Xxxxxxx or
Xxxxxx shall be considered a material breach of this Agreement and shall result
in the termination of this Agreement with any money paid to the Escrow Agent
being forfeited by the Buyer as liquidated damages. The resignations and
resolutions to appoint Messrs. Xxxxxxx and Xxxxxx as directors shall be in a
form as set forth in Exhibits D, E and F attached hereto.
Representations and Warranties of Storm and Buyer
11. Storm hereby represents and warrants to the Buyer as follows:
11.1 Organization and Standing; Articles and Bylaws. Storm is a
corporation duly organized and existing under, and by virtue of, the laws of the
State of Florida and is in good standing under such laws. Storm has the
requisite corporate power to own and operate its properties and assets, and to
carry on its business. Storm is qualified, licensed or domesticated as a
foreign corporation in all jurisdictions where the nature of its activities or
of its properties owned or leased makes such qualification, licensing or
domestication necessary at this time. Storm has furnished or shall cause to be
furnished to the Buyer copies of its Articles of Incorporation and Bylaws. Said
copies are true, correct and complete and contain all amendments through the
date of this Agreement.
11.2 Corporate Power. Storm has now, or will have at the Closing Date,
all requisite legal and corporate power to enter into this Agreement, to sell
the securities hereunder, and to carry out and perform its obligations under the
terms of this Agreement.
11.3 Subsidiaries. Storm has no subsidiaries. Storm does not own,
directly or indirectly, shares of stock or other interests in any other
corporation, association, joint venture, or business organization.
11.4 Capitalization. The authorized capital stock of Storm is
50,000,000 shares of Common Stock. 8,521,599 shares of Common Stock are issued
and outstanding. The issued and outstanding shares of Common Stock have been
duly authorized and validly issued, are fully paid and nonassessable and were
issued in compliance with applicable state and federal laws concerning the
issuance of securities. There are no outstanding rights, warrants, conversion
rights, or agreements for the purchase or acquisition from Storm of any shares
of its capital stock, except (i) options for 30,000 shares of Common Stock at an
exercise price of $.10, and 10,000 shares of Common Stock at an exercise price
of $1.00. Such options have been granted to Storm's market maker, Equitrade
Securities Corporation. Said options have existed for more than one (1) year
prior the instant Agreement.
12.0 Authorization of Storm
(a) All corporate action on the part of Storm, its officers,
directors, and stockholders are authorized in connection with the sale and
issuance of the securities pursuant hereto and the performance of Storm's
obligations hereunder including the consent of a majority of the outstanding
shares. Director and President, Xx. Xxxxxx Xxxxxxxxxx, and Director and
Vice-President, Xx. Xxxxxxx Xxxxxxxxx, control and own more than 80% of the
issued and outstanding securities of Storm and hereby consent to this Agreement
as evidenced by their signatures hereto. This Agreement is a legal, valid and
binding obligation of Storm, enforceable against Storm in accordance with its
terms, except as limited by bankruptcy, insolvency, reorganization, moratorium
or similar laws of general application affecting enforcement of creditors'
rights, and except as limited by application of legal principles affecting the
availability of equitable remedies.
(b) The Securities, when issued in compliance with the provisions
of this Agreement, will be validly issued, fully paid and nonassessable, and
will be free of any liens or encumbrances; provided, however, that such shares
may be subject to restrictions on transfer under state and/or federal securities
laws as set forth herein, and as may be required by future changes in such laws.
In fact, no securities of Storm have been registered with the Commission.
(c) No shareholder of Storm has any right of first refusal or any
preemptive rights in connection with the issuance of the Securities or of the
Common Stock by Storm.
13. Financial Statements. (Storm's audited balance sheet and statement
of income and expenses for the fiscal year ended December 31, 1999, are
hereinafter collectively referred to as the "Financial Statements.") The Buyer
has been supplied interim, unaudited financial statements. The Buyer intends to
secure the services of an independent auditing firm to generate audited
financial statements for Storm. At the conclusion of said audit, the financial
statements will fairly present the financial condition of Storm and the results
of the operations, if any, of Storm as of the date. Storm warrants that it has
no liabilities other than those set forth in the schedule attached hereto as
part of this Agreement as Exhibit C.
14. Material Contracts and Commitments. All the material contracts,
commitments, agreements, and instruments to which Storm is a party are legal,
valid, binding, and in full force and effect in all material respects and
enforceable by Storm in accordance with their terms except as limited by
bankruptcy, insolvency, reorganization, moratorium, or similar laws of general
application affecting enforcement of creditors' rights, and except as limited by
application of legal principles affecting the availability of equitable
remedies. Storm hereby discloses that is has not generated more than nominal
revenue in the most recent fiscal year.
15. Compliance with Other Instruments. Storm is not in violation of
any term of its respective Articles of Incorporation or Bylaws, or in any
material respect of any contract, agreement, instrument, or, to the best
knowledge of Storm, any judgement, decree, order, statute, rule, or regulation
applicable to it. The execution, delivery, and performance of this Agreement by
Storm and the Buyer, and the issuance and sale of the Securities pursuant
hereto, will not result in any such violation or be in conflict with or
constitute a default under any such term, or cause the acceleration of maturity
of any loan or material obligation to which Storm is a party.
16. Litigation. There are no actions or proceedings against Storm
which might result in any adverse change in the prospects, conditions, affairs,
or operations if any of Storm or in any of its properties or assets, or in any
impairment of the right or ability of Storm to carry on its business as proposed
to be conducted.
17. Offering. The offer, sale and issuance of the Securities in
conformity with the terms of this Agreement will not violate the Securities Act.
18. Insurance. Storm does not currently have in force liability
insurance with insurer.
19. Taxes. Storm has timely filed tax returns that are required to
have been filed by them prior to the date of this Agreement with appropriate
taxation authorities.
20. Disclosure. This Agreement, the Financial Statements, and all
certificates delivered to the Buyer pursuant to this Agreement, when read
together, do not contain any untrue statement of a material fact and do not omit
to state a material fact necessary in order to make the statements contained
therein or herein not misleading. There is, to the best of Storm's knowledge,
no fact which materially adversely affects the prospects, condition, affairs or
operations of Storm or any of its properties or assets which has not been set
forth in this Agreement.
21. Representations and Warranties by Buyer. The Buyer represents and
warrants to Storm as follows:
(a) The Buyer is experienced in evaluating and investing in
companies such as Storm and has had the opportunity to discuss Storm's business,
management and financial affairs with its Chief Executive Officer, Xx. Xxxxxx
Xxxxxxxxxx. The Buyer further warrants that it has received or shall request at
some future date prior to closing any and all information it requires prior to
the closing.
(b) The securities are being acquired for the account of the
Buyer, for investment and not with a view to, or for resale in connection with,
any distribution or public offering thereof within the meaning of the Securities
Act. To the extent a distribution or public offering occurs, it shall be
conducted in accordance with the applicable federal securities laws.
(c) The Buyer understands that Storm's shares have not been
registered with the U.S. Securities and Exchange Commission (the "SEC") pursuant
to Section 12 of the Securities Act of 1934, as amended, nor has Storm
registered any transactions pursuant to the Securities Act of 1933, as amended.
The Buyer further represents that as part of its performance pursuant to the
terms of this Agreement, the Buyer shall have the sole and complete
responsibility and shall use its best efforts to arrange for filing the
appropriate registration statement in connection with Storm to have Storm's
shares registered under Section 12(g) of the Securities Exchange Act of 1934, as
amended. (such registration statement and other documents filed with the SEC are
referred to herein as the "SEC Filings"). Said registration shall be completed
and filed with the SEC prior to April 1, 2000. The Buyer and Storm acknowledge
Storm will be delisted or be relegated to trading in the "pink sheets" upon the
failure to timely and successfully complete the registration process. All
parties hereto agree that failure to timely register Storm shall constitute a
material breach of this Agreement.
Any failure to timely and successfully complete the registration process
due to delays beyond the control of the Buyer, such as a failure of the auditors
to perform on a timely basis shall not constitute a material breach of this
Agreement by the Buyer.
(d) Notwithstanding that Storm has been publicly traded for more
than two years, the Buyer understands that only limited and nominal trading has
occurred in Storm's stock pursuant to its current listing on the Over the
Counter Bulletin Board ("OTCBB").
(e) The Buyer has the full right, power and authority to enter
into and perform this Agreement, and this Agreement constitutes a legal, valid
and binding obligation upon the Buyer, its successors, and assigns except as may
be limited by bankruptcy, insolvency, reorganization, moratorium or similar laws
of general application affecting enforcement of creditors' rights, and except as
limited by application of legal principles affecting the availability of
equitable remedies.
(f) The Buyer hereby acknowledges that it shall be responsible for
its own costs and expenses, including attorney's and auditor's fees, in
connection with the subject business combination. Buyer and Storm acknowledge
that each has or has had the opportunity to have its own legal representation by
its own securities counsel. Each party understands and agrees it is responsible
for payment of legal fees of its respective counsel.
22. Legends. Each instrument or certificate representing the
Securities may be presented with the following legend:
THE SECURITIES EVIDENCED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED UNDER THE
SECURITIES ACT OF 1933, AS AMENDED, AND MAY NOT BE SOLD, TRANSFERRED, ASSIGNED
OR HYPOTHECATED UNLESS THERE IS AN EFFECTIVE REGISTRATION STATEMENT UNDER SUCH
ACT COVERING SUCH SECURITIES, THE SALE IS MADE IN ACCORDANCE WITH RULE 144 UNDER
THE ACT, OR THE COMPANY RECEIVES AN OPINION OF COUNSEL FOR THE HOLDER OF THESE
SECURITIES REASONABLY SATISFACTORY TO THE COMPANY STATING THAT SUCH SALE,
TRANSFER, ASSIGNMENT OR HYPOTHECATION IS EXEMPT FROM THE REGISTRATION AND
PROSPECTUS DELIVERY REQUIREMENTS OF SUCH ACT.
Conditions to Closing
23. Conditions to Storm's Obligations. Storm shall stand ready to sell
the Securities to the Buyer.
24. Conditions to Obligations of Storm. Storm's obligation to sell and
transfer the Securities to the Buyer at the Closing is subject to the
fulfillment of Storm's satisfaction on or prior to the Closing Date of the
following conditions, any of which may be waived by the Buyer in writing signed
by an authorized officer:
(a) The above representations and warranties made by Storm shall
be true and correct when made, and shall be true and correct on the Closing Date
with the same force and effect as if they had been made on and as of said date.
(b) Storm shall not make any public disclosure regarding this
Agreement unless required to do so under the applicable securities laws. The
parties hereby acknowledge Storm shall issue a press release upon execution of
the instant agreement.
(c) Storm shall cooperate with the auditors and provide all
requested information in a prompt and reasonable manner.
(d) Storm must cease and terminate any and all discussions with
other prospective acquirer or merger partners upon execution of this Agreement.
(e) Storm shall instruct and direct its agents, affiliates and
others to cooperate in the preparation of, and to timely file or provide
information to governmental authorities, self regulatory bodies or other third
parties to effectuate the subject business combination pursuant to the terms of
this agreement.
25. Waivers and Amendments. With the consent of the Buyer and of the
record or beneficial holders of more than 80 percent of the securities to be
purchased, the obligations of Storm's and the Buyer's rights under this
Agreement may be waived (either generally or in a particular instance, either
retroactively or prospectively and either for a specified period of time or
indefinitely), and with the same consent of Messrs. Hannaberry and Zacharoff,
may enter into a supplementary agreement with the Buyer to change in any manner
or eliminating any of the provisions of this Agreement; provided, however, that
no such waiver or supplemental agreement shall reduce the aforesaid percentage
of Securities to be acquired in this transaction. This Agreement or any
provision hereof may be changed, waived, discharged or terminated only by a
statement in writing signed by the party against which enforcement of the
change, waiver, discharge or termination is sought.
26. Conditions to Buyer's Obligations. The Buyer's obligations to
purchase the securities at the Closing is subject to the fulfillment of the
Agreement to Messr's Hannaberry and Zacharoff's reasonable satisfaction on or
prior to the Closing Date of the following conditions:
(a) Representations and Warranties Correct; Performance of
Obligations. The representations and warranties made by the Buyer shall be true
and correct when made, and shall be true and correct on the Closing Date with
the same force and effect as if they have been made on and as of said date;
Storm shall not have been adversely affected in any way prior to Closing the
transaction unless Storm becomes a reporting issuer prior to the Closing; Storm
shall have performed all obligations and conditions herein or any other related
agreement required to be performed or observed by it on or prior to the Closing
date.
(b) Legitimate Investment. At the time of the Closing, the Buyer
of the Securities hereunder shall be legally permitted by the laws and
regulations to which the Buyer and Storm are subject.
(c) Due Diligence and Confidentiality. The Buyer shall provide
sufficient documents and other information upon the demand of Messrs. Hannaberry
and Zacharoff in order that the Messrs. Hannaberry and Zacharoff can conduct
their due diligence review with respect to the Buyer. In the course of the
parties' due diligence investigations, discussions and negotiations, each party
may disclose to the other certain proprietary, confidential or other non-public
information relating to its respective business, the proprietary, confidential
and non-public nature of which information both parties desire to maintain.
Except as set forth herein, no party shall reveal or make known to any person,
firm corporation or entity or utilize in its own business or make any other
usage of any information disclosed to it by the other in connection with the
discussions and negotiations in connection with the subject transaction. The
obligation to limit disclosure shall cease if the information becomes part of
the public domain or the party has independently developed the information
without the use of any information provided by the other party. In the event
the business combination does not occur and the transaction is not completed,
the parties agree to return all documents, including original and all copies in
their possession, which were obtained in connection with this Agreement and to
maintain the confidentiality of any information obtained hereunder for a period
not to exceed two (2) years.
DUE DILIGENCE REVIEW
Storm shall permit the Buyer's employees, agents, accountants, legal
counsel and other representatives to have access to Storm's books, records,
employees, counsel, accountants, engineers and other representatives at all
reasonable times for the purpose of conducting its due diligence investigation.
Storm will make available to the Buyer for examination and reproduction all
documents and data of every kind and character relating to this Agreement and
the transactions contemplated hereby, in possession or control of, or subject to
reasonable access by either party. All such due diligence investigations shall
be completed and the Buyer shall notify Storm in writing of the satisfaction or
removal of this due diligence review condition by no later than March 6, 2000.
Upon mutual agreement of the parties, additional time may be allowed to complete
such due diligence investigation. Should the Buyer or Storm (in the context of
the due diligence investigation, either party is referred to as the "Reviewing
Party") become aware of any information during its due diligence investigation
which, in the opinion of the Reviewing Party, could have material adverse impact
on this Agreement and/or the transactions contemplated hereby, the Reviewing
Party shall immediately notify the company whom the Reviewing Party investigated
(the "Receiving Party") in writing of such information and the concerns which
such information has caused. The Receiving Party shall have a reasonable time
to respond to those concerns. In the event that the concerns cannot be resolved
to the satisfaction of the Reviewing Party, the Reviewing Party shall have the
right to terminate this Agreement without further liability hereunder. Each
party shall bear the costs and expenses of the respective due diligence
investigation hereunder, including the fees and expenses of professional
advisors.
(d) Payment of Third Parties. The Buyer will certify or represent
to Storm that the Buyer has paid any all third parties in connection with
subject transaction, including but not limited to the accountants, in full prior
to or on the Closing Date.
(e) The Buyer hereby acknowledges that it shall be responsible for
its own costs and expenses, including attorney's and auditor's fees, in
connection with the subject business combination.
(f) The Buyer and Storm shall observe the spirit and intent of
this Agreement and other related agreement in connection with the sale of the
Control Block of Common Stock of Storm High Performance Sound Corporation.
27. Governing Law. This Agreement shall be governed in all respects by
the laws of the District of Columbia.
28. Survival. The representations, warranties, covenants, and
agreements made herein shall survive the Closing of the transactions
contemplated hereby.
29. Successors and Assigns. Except as otherwise expressly provided
herein, the provisions hereof shall inure to the benefit of, and be binding
upon, the successors, assigns, heirs, executors and administrators of the
parties hereto.
30. Entire Agreement. This Agreement and the other documents delivered
pursuant hereto constitute the full and entire understanding and agreement
between the parties hereto with regard to the subjects hereof and thereof.
31. Notices. All notices and other communications required or
permitted hereunder shall be in writing and shall be mailed by first class mail,
postage prepaid, addressed (a) if to the Buyer, at such the Buyer's address set
forth below or at such other address as the Buyer shall have furnished to Storm
in writing, or (b) if to Storm at its address set forth below, or at such other
address as Storm shall have furnished to the Buyer.
To Buyer: To Storm: To Escrow Agent:
------------------------------ ------------------------- -------------------------
Xx. Xxxxxx Xxxxxxxxxx
Xx. Xxxxxxx Xxxxxxx Xxxxx High Performance Mr. Xxxxx Xxxxxx-Xxxxxxx
North Coast Productions, Inc. Sound Corporation Law Firm of Xxxxxx-Xxxxxxx, P.C.
0000 000xx Xxxxxx XX 000 Xxxxxxx 00 Xxxx 0000 X Xxxxxx, X.X., Xxxxx 0000
Xxxxxxxx, XX 00000 Xxxxxxxx, Xxxxxxx X0X 0X0 Xxxxxxxxxx, X.X., 00000
(Tel) 000- 000-0000 (Tel.) 000- 000-0000 (Tel.) (000) 000-0000
(Fax) 000-000-0000 (Fax) 000-000-0000 (Fax) (000) 000-0000
32. Separability. In case any provision of this Agreement, not
material to the benefits intended to be conferred hereby shall be invalid,
illegal, or unenforceable, the validity, legality, and enforceability of the
remaining provisions shall not in any way be affected or impaired thereby.
33. Finder's Fees.
(a) Storm (i) represents and warrants that it has retained no
finder or broker in connection with the transactions contemplated by this
Agreement and (ii) hereby agrees to indemnify and to hold Buyer's officers,
directors and controlling persons harmless of and from any liability for
commission or compensation in the nature of a finder's fee to any broker or
other person or firm (and the costs and expenses of defending against such
liability or asserted liability) for which Storm, or any of its employees or
representatives, are responsible.
(b) The Buyer (i) represents and warrants that it has retained no
finder or broker in connection with the transactions contemplated by this
Agreement and (ii) hereby agree to indemnify and to hold Storm, and their
respective officers, directors and controlling persons, harmless of and from any
liability for any commission or compensation in the nature of a finder's fee to
any broker or other person or firm (and the costs and expenses of defending
against such liability or asserted liability) for which Storm, or any of its
employees or representatives, are responsible.
(c) The Buyer and Storm represent, warrant and covenant Xxxxxx
Xxxxx and Tuscan Capital Ltd. ("Tuscan Capital") have served as consultants to
Storm. As such, all parties agree he shall be paid for said services upon
consummation of the transaction. Payment to Xx. Xxxxx or Tuscan Capital is
pursuant to a separate and independent agreement (Consulting Agreement) and
neither Xx. Xxxxx nor Tuscan Capital shall receive compensation under this
Agreement except as set forth in the Consulting Agreement. The parties to this
Agreement shall in good faith execute such other and further instruments,
assignments or documents as may be necessary or advisable to carry out the
transactions contemplated by this Agreement.
34. Titles and Subtitles. The titles of the Sections and subsections
of this Agreement are for convenience of reference only and are not to be
considered in construing this Agreement. References herein to exhibits to this
Agreement shall be deemed to incorporate such exhibits by reference.
35. Counterparts. This Agreement may be executed in any number of
counterparts, each of which shall be an original, but all of which together
shall constitute one instrument, and which shall become effective when there
exist copies signed by Storm's directors, Messrs. Hannaberry and Zacharoff, and
the Buyer. All parties hereto agree that facsimiles of signatures and documents
including counterpart signatures shall be acceptable as signed copies of this
Agreement.
IN WITNESS WHEREOF, the undersigned have caused this Agreement to be
executed by their duly authorized representatives effective as of last date this
agreement is signed by one of the two below parties.
Storm High Performance Sound Corp. North Coast Productions, Inc. (Buyer)
By: /s/ Xxxxxx Xxxxxxxxxx
-------------------------------------------
Xxxxxx Xxxxxxxxxx, Director By: /s/ Xxxxxxx X. Xxxxxxx
---------------------------
Xxxxxxx Xxxxxxx, President
North Coast Production, Inc.
0000 000xx Xxxxxx, XX
By:/s/ Xxxxxxx Xxxxxxxxx Kirkland, Xxxxxxxxxx, XX 00000
-------------------------------------------
Xxxxxxx Xxxxxxxxx, Director Buyer
Storm High Performance Sound Corp. (000) 000-0000
000 Xxxxx Xxxxxx Xxxxx 8th Floor Xxxx Xxxxx
Xxxx Xxxx Xxxxx, Xxxxxxx 00000
(000) 000-0000 Dated:
Dated:
EXHIBIT A
DEPOSIT ESCROW AGREEMENT
DEPOSIT ESCROW AGREEMENT ("Deposit Agreement") dated January 27, 2000 by
and among Storm High Performance Sound Corporation, 000 Xxxxxxx 00 Xxxx,
Xxxxxxxx, Xxxxxxx Xxxxxx X0X 0X0, phone number (000) 000-0000 (the "Company")
and North Coast Productions Inc., 0000 - 000xx Xxxxxx XX, Xxxxxxxx, XX 00000,
phone number (000) 000-0000 ("Buyer").
WHEREAS, Buyer and the Company entered into a Stock Purchase Agreement
dated January 27, 2000, ("Stock Purchase Agreement") in which, inter alia, the
Company agreed to sell and Buyer agreed to purchase 7,115,793 shares of the
stock in the Company ("Shares").
WHEREAS, the Buyer has agreed to tender payment of $300,000 in
installments as payment for the shares in accordance with the Stock Purchase
Agreement;
WHEREAS, Buyer and the Company have agreed that the funds paid by
Buyer under the Stock Purchase Agreement shall be tendered to and held under
this Deposit Agreement and disbursed at closing as agreed to by the parties and
as described in this Deposit Agreement;
WHEREAS, upon Closing, the Shares to be delivered to Buyer shall be
issued in the name of Buyer or Buyers' designee as set forth in this Deposit
Agreement.
NOW THEREFORE, in consideration of the respective premises, mutual
covenants and agreements of the parties hereto, and other good and valuable
consideration, the receipt and sufficiency of which are hereby acknowledged, the
parties hereto agree as follows:
1. Appointment of Escrow Agent. Law Firm of Xxxxxx-Xxxxxxx, P.C.
is hereby appointed as Escrow Agent hereunder ("Escrow Agent") and the Escrow
Agent hereby accepts such appointment. The Escrow Agent shall act in accordance
with the instructions set forth in this Deposit Agreement and any further
instructions given to it by written instrument signed by Buyer and the Company.
The Escrow Agent hereby discloses to all parties that it has in the past, and
continues to represent the Company. The Company and Buyer acknowledge the
instant disclosure and waive any conflicts of interest.
2. Payment of the Purchase Price by Buyer to the Escrow Agent.
Buyer shall deposit with the Escrow Agent payments as follows:
DUE DATE OF PAYMENT AMOUNT
On or before February 4, 2000 $ 50,000
Escrow Agent hereby acknowledges receipt of $10,000 from Buyer.
3. By Febr
uary 4, 2000, Buyer shall open an account with the Xxxxx National Bank ("Xxxxx
Bank:"), 0000 X Xxxxxx XX, Xxxxxxxxxx XX 00000 for the purpose of depositing
Buyer payments of $250,000.
4. As set forth herein, Buyer shall provide instructions to Xxxxx Bank
authorizing Xxxxx Bank to respond to balance verification requests of Escrow
Agent.
A. In the event the Company grants Buyer an extension on any
deadlines and the Buyer and Company jointly submit to Escrow Agent a copy of
notification of any such extension, the due date of such payments shall be the
due date set forth in the extension notification.
B. In the event Buyer has deposited payments aggregating $232,500
to the Escrow Agent and the Xxxxx Bank account on or before the due date of the
$250,000 payment and Buyer and the Company jointly submit to Escrow Agent a copy
of written notification of the Company's granting of an extension of the due
date to pay the remaining balance due, the due date of the remaining payment due
and the Closing Date of this Deposit Agreement shall be extended in accordance
with such notification.
5. Delivery of Shares by Shareholders. Within seven days of the Buyer
depositing $50,000, the Company shall cause share certificates to be issued in
the name of Buyer for 7,115,793 fully paid and non-assessable shares of the
common stock, par value $.001 per share of the Company and place such
certificate with the Escrow Agent with documents necessary to deliver such
shares to Buyer on March 31, 2000.
6. Custody and Disposition of the Shares. The Escrow Agent shall hold
and dispose of the Certificates representing the Shares and any monies,
certificates, instruments or documents held by it hereunder only in accordance
with the terms of this Deposit Agreement.
7. Delivery of Shares Upon Closing. At the Closing (as defined in the
Stock Purchase Agreement), the Escrow Agent shall deliver to Buyer the
certificate or certificates representing the number of Shares to be delivered to
Buyer under the terms of the Stock Purchase Agreement and this Deposit
Agreement.
8. Distribution of Proceeds Received From Buyer. Upon receipt by
Escrow Agent of the $50,000 from Buyer and verification by Escrow Agent of the
$250,000 of funds deposited to the Xxxxx Bank account by Buyer, the parties
hereto agree that the aggregate receipts of $300,000 shall be disbursed in
accordance with the payment schedule agreed upon by the parties per the Schedule
of Payments set forth in Exhibit "B" annexed to the Stock Purchase Agreement.
Thereto, Xx. Xxxxxxx Xxxxxxx, representing Buyer, and Xxxxx Xxxxxx-Xxxxxxx (as
Escrow Agent) shall jointly appear at Xxxxx National Bank in Washington D.C. and
jointly issue and verify payment to the list of creditors as set forth in
Exhibit "B".
9. Waiver of Dividends and Other Distributions. During the period when
the Shares shall remain on deposit with the Escrow Agent, no dividends nor other
distributions shall be paid on the Shares. However, immediately upon delivery
of the Shares to Buyer or Buyer's designees, as the case may be, under the terms
of this Deposit Agreement, the Shares shall have the same status and rights as
all other shares of the Company's common stock of the same class, including but
not limited to full and complete rights to receive any dividends or
distributions payable or distributable to the holders of the Company's common
stock of the same class.
10. Indemnification. Buyer and the Company agree, jointly and
severally to indemnify, defend and hold harmless the Escrow Agent from and
against any and all costs (including, without limitation, legal fees and
expenses), liabilities, claims and losses arising out of or in connection with
this Deposit Agreement or any action or failure to act by the Escrow Agent under
this Deposit Agreement
11. Concerning the Escrow Agent. To induce the Escrow Agent to act
hereunder, it is further agreed by the undersigned that:
A. This Agreement expressly sets forth all the duties of the
Escrow Agent with respect to any and all matters pertinent hereto. No implied
duties or obligations shall be read into this Agreement against the Escrow
Agent. The Escrow Agent shall not be bound by the provisions of any agreement
among the other parties hereto except this Agreement.
B. The Escrow Agent shall not be liable for any action or failure
to act in its capacity as Escrow Agent hereunder unless such action or failure
to act shall constitute willful misconduct on the part of the Escrow Agent.
C. The Escrow Agent shall be entitled to rely upon any order,
judgment, certification, demand, notice, instrument or other writing delivered
to it hereunder without being required to determine the authenticity or the
correctness of any fact stated therein or the propriety or validity of the
service thereof. The Escrow Agent may act in reliance upon any instrument or
signature believed by it to be genuine and may assume that any person purporting
to give notice or receipt or advice or make any statement or execute any
document in connection with the provisions hereof has been duly authorized to do
so.
D. The Escrow Agent may act pursuant to the advice of counsel with
respect to any matter relating to this Agreement and shall not be liable for any
action taken or omitted in accordance with such advice.
E. The Escrow Agent does not have any interest in the Shares or
any other property deposited hereunder but is serving as escrow holder only and
having only possession thereof. Buyer shall pay or reimburse the Escrow Agent
upon request for any transfer taxes relating to the Shares incurred in
connection herewith and shall indemnify and hold harmless the Escrow Agent from
any amounts that it is obligated to pay in the way of transfer taxes.
F. The Escrow Agent makes no representations as to the validity,
value or genuineness of any security or other document or instrument held by or
delivered to it.
G. The Escrow Agent (and any successor Escrow Agent) shall at any
time resign as such by delivering the Shares and the funds to any successor
Escrow Agent, jointly designated by the other parties hereto in writing, or to
any court of competent jurisdiction, whereupon the Escrow Agent shall be
discharged of and from any and all further obligations arising in connection
with this Agreement. The resignation of the Escrow Agent will take effect on
the earlier of (a) the appointment of a successor (including a court of
competent jurisdiction) or (b) the day which is 30 days after the date of
delivery of its written notice of resignation to the other parties hereto. If
at that time the Escrow Agent has not received a designation of a successor
Escrow Agent, the Escrow Agent's sole responsibility after that time shall be to
safekeep the Shares until receipt of a designation of successor Escrow Agent, or
a joint written disposition instruction by the other parties hereto or a final
order of a court of competent jurisdiction.
H. In the event of any disagreement between the other parties
hereto resulting in adverse claims or demands being made in connection with the
Shares, or in the event that the Escrow Agent shall be entitled to retain the
Shares until the Escrow Agent shall have received (i) a final nonappealable
order of a court of competent jurisdiction directing delivery of the Shares, or
(ii) a written agreement executed by the other parties hereto directing delivery
of the Shares, in which the Escrow Agent shall disburse the Shares in accordance
with such order or agreement. Any court order referred to in (i) above shall be
accompanied by a legal opinion by counsel for the presenting party satisfactory
to the Escrow Agent to the effect that said court order is final and
nonappealable. The Escrow Agent shall act on such court order and legal opinion
without further question.
I. This Agreement shall be binding upon and inure solely to the
benefit of the parties hereto and their respective successors (including
successors by way of merger) and assigns, heirs, administrators and
representatives and shall not be enforceable by or inure to the benefit of any
third party except as provided in paragraph (g) with respect to a resignation by
the Escrow Agent.
J. This Agreement may be modified by a writing signed by all the
parties hereto, and no waiver hereunder shall be effective unless in a writing
signed by the party to be charged.
12. Governing Law. This Agreement shall be governed in all respects by
the internal laws of the District of Columbia.
13. Notices. All notices, requests, consents and other communications
hereunder shall be in writing, shall be delivered by hand or mailed by first
class registered or certified mail, return receipt requested, postage prepaid.
Each such notice or other communication shall for all purposes of this Agreement
be treated as effective or having been given when delivered if
delivered pers
onally, or, if sent by mail, at the earlier of its receipt or 72 hours after the
same has been deposited with a postal employee or in a regularly maintained
receptacle for the deposit of mail, addressed and mailed as aforesaid.
14. Counterparts. This Agreement may be executed in one or more
counterparts, each of which shall be deemed to be an original, but all of which
together shall constitute one and the same instrument.
15. Facsimile. The parties hereto agree the facsimile transmitted
version of the Agreement shall have the same force and effect as the original
"hard copy " of this Agreement.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to
be duly executed and delivered, as of the day and year first above written.
Escrow Agent:
LAW FIRM OF XXXXXX-XXXXXXX, P.C.
By: /s/ Xxxxx Xxxxxx-Xxxxxxx
Xxxxx Xxxxxx-Xxxxxxx, Esquire
Buyer:
NORTH COAST PRODUCTIONS INC.
By: /s/ Xxxxxxx X. Xxxxxxx
Xxxxxxx X. Xxxxxxx, President
The Company:
STORM HIGH PERFORMANCE SOUND CORP.
By: /s/ Xxxxxx Xxxxxxxxxx
Xxxxxx Xxxxxxxxxx, President
EXHIBIT "B"
SCHEDULE OF PAYMENTS
A list of payables of the Company as of January 1, 2000 appended to the Stock
Purchase Agreement executed by and agreed to among the parties as Exhibit C
(copy of which is annexed hereto) sets forth the name of creditors and amounts
owing to such creditors by the Company:
The parties to this Deposit Agreement hereby agree that upon and at Closing
Buyer shall disburse proceeds deposited to the Xxxxx Bank account in the
following order and amounts:
AMOUNT
CREDITOR
--------------------------------------------------
Continental Stock Transfer $ 300.40
Toronto Dominion Bank in exchange
for release of liens and
encumbrances against the Company 19,036.46
County of West Palm Beach,
Property Taxes 254.00
Standard & Poor's 3,000.00
Xxxxx Xxxxxx 8,250.00
Xxxxxxx'x Storage 746.80
Xxxxx Xxxxxxx Xxxxx & Co. 8,600.34
IGS Renfrew County 176.49
The law firm of Xxxxxx-Xxxxxxx 34,249.44
Cygraphics 286.40
Xxx Xxxxxxxxx 18,000.00
Xxx Xxxxxxxxx 1,100.00
Xxxxxx Xxxxxxxxxx & Xxxxxxx Xxxxxxxxx 39,175.00
Xxxxxx Xxxxxxxxxx 3,028.28
Xxxxxxx Xxxxxxxxx 13,753.10
Tuscan Capital Ltd. 100,043.29
TOTAL $250,000.00
===========
The $50,000 of funds deposited with Escrow Agent shall be disbursed to in
accordance with instructions to be provided to Escrow Agent by Messrs.
Hannaberry and Zacharoff on or prior to Closing.
EXHIBIT C
PAYABLES
AS OF JANUARY 1, 2000
Creditor Description Amount
------------------------------------ ----------------------- ----------
Toronto Dominion Bank Operating Loan $19,036.46
------------------------------------ ----------------------- ----------
Xxx Xxxxxxxxx Payment on Loan 18,000.00
Xxx Xxxxxxxxx Private Loan 1,100.00
Xxxxxxxx'x Storage Storage 746.80
UPS Shipping 0.00
Buskie Office Supplies Office Supplies 0.00
Continental Stock Transfer Transfer Agent 300.40
County of West Palm Beach Property Taxes 254.00
Xxxxx Xxxxxxx Xxxxx & Co. Accounting Fees 8,600.24
IGS Renfrew County Internet Service 176.49
Corporate Offices Rent 0.00
The Law Firm of Xxxxxx-Xxxxxxx, P.C. Legal fees 34,249.44
Cygraphics Printing 286.40
Flex 2000 Sales Commissions 0.00
Xxxxx Xxxxxx Factoring Loan 8,250.00
Standard & Poor's Annual fee 3,000.00
Xxxxxx Xxxxxxxxxx & Private loan 12/1/97 13,386.00
Xxxxxxx Xxxxxxxxx Private loan 12/1/97 25,789.00
Xxxxxx Xxxxxxxxxx Private loan in 1998 3,028.28
Xxxxxxx Xxxxxxxxx Private loan in 1998 13,753.10
TOTAL PAYABLES $ 149,956.00
RESIGNATION OF DIRECTOR
I, Xxxxxx Xxxxxxxxxx, being a duly elected director of The Storm High
Performance Sound Corporation, hereby tender my resignation as a director
effective this ____ day of January, 2000.
__________________________________
Xxxxxx Xxxxxxxxxx
EXHIBIT E
RESIGNATION OF DIRECTOR
I, Xxxxxxx Xxxxxxxxx, being a duly elected director of The Storm High
Performance Sound Corporation, hereby tender my resignation as a director
effective this ____ day of January, 2000.
__________________________________
Xxxxxxx Xxxxxxxxx
EXHIBIT E
RESOLUTION OF SHAREHOLDERS AND DIRECTORS
OF
STORM HIGH PERFORMANCE SOUND CORPORATION
(the "Company")
WHEREAS, Xxxxxx Xxxxxxxxxx and Xxxxxxx Xxxxxxxxx collectively own 85.9% of
the outstanding Common Stock of the Company.
WHEREAS, The two shareholders comprise the Board of Directors and
Officers;
It is RESOLVED, that the shareholders wave the notice requirement of
Article I, Sections
2 and 4 of the Bylaws.
It is RESOLVED, that the shareholders consent to this action without a
meeting as
permitted by Article I, Section 9 of the Bylaws.
It is RESOLVED, that the undersigned, in their capacities as shareholders
hereby elect Xxxxxxx Xxxxxxx and Xxxxx Xxxxxx to the Company's Board of
Directors.
_________________________________
Xxxxxx Xxxxxxxxxx
__________________________________
Xxxxxxx Xxxxxxxxx
AMENDMENT TO STOCK PURCHASE AGREEMENT
1. Whereas, the parties hereto, North Coast Productions, Incorporated and
The Storm High Performance Sound Corporation, entered into a stock purchase
agreement dated January 28, 2000 and a Deposit Escrow Agreement dated January
27, 2000.
2. Whereas, the parties hereto acknowledge the instant writing constitutes
the first and only written amendments to the Stock Purchase Agreement and
Deposit Escrow Agreement.
3. Whereas, the parties hereto acknowledge and agree the instant amendment
is limited only to the express terms of the instant amendment and all other
provisions of the agreements shall remain the same.
4. The parties hereto agree the Articles of Merger shall be filed with the
applicable governmental agencies following the closing and in no event shall ten
(10) business days expire without the filing of the articles of merger.
North Coast Productions has the responsibility for preparing and filing the
Articles of Merger.
5. The parties hereto agree the balance of the purchase price in the amount
of Two Hundred and Fifty Thousand Dollars ($250,000.00) shall be transferred via
electronic wire on March 30, 2000 to Xxxxx National Bank to the existing
Escrow Deposit Account. The wiring instructions and banking coordinates shall
remain the same as set forth in the original stock purchase agreement.
6. From the escrow account, Xx. Xxxxxx Xxxxxxxxxx and Xx. Xxxxxx-Xxxxxxx
shall pay the accounts payable for Storm in the amount not to exceed One Hundred
Forty-Nine Thousand, Nine Hundred and Fifty Six Dollars and Zero Cents
($149,956.00). Any and all accounts payable shall be paid in full on March 31,
2000.
7. With respect to Item 21(c) of the stock purchase agreement, the parties
hereto agree the registration statement shall be completed and filed with the
U.S. Securities and Exchange Commission prior to April 15, 2000.
8. The parties hereto agree the executed facsimile containing each of the
three below signatures shall have the same force and effect as the original.
Buyer For the Company
NORTH COAST PRODUCTIONS INC. THE STORM HIGH PERFORMANCE SOUND CORP.
/s/ Xxxxxxx X. Xxxxxxx /s/ Xxxxxx Xxxxxxxxxx
Xxxxxxx X. Xxxxxxx, President Xxxxxx Xxxxxxxxxx, President
FAX #000-000-0000
Escrow Agent
Law Firm of Xxxxxx-Xxxxxxx, P.C.
/s/ Xxxxx Xxxxxx-Xxxxxxx
Xxxxx Xxxxxx-Xxxxxxx